Greece endgame.....

Bank of America Merrill Lynch has just released an investor survey.  Here is the collective response to the question on what is the likely outcome of the Greek negotiations:

This survey was taken before Tsipras's inflammatory speech to parliament last night.  Various takeouts as reported by European media:

"Greece accuses 'criminal' creditors as default nears" - The Guardian

"IMF has 'criminal' responsibility for today's situation" - PM Tsipras 

"Juncker says Greece is "misleading voters" - BBC

Lots of rhetoric on both sides, makes a middle ground look quite hard to find.  Yet in a domestic poll also released yesterday by Mega TV, Greek voters responded  to the question "Should Greece stay in the Euro at any cost?", 69.7% responded "Yes" or "Probably Yes"

Greek CDS are now pricing about a 75% probability of default within 1 year, Greek stock market is off nearly 15% in 3 days....

Ultimately we expect some kind of deal to get down even if that includes some element of technical default and write-down, but contagion should not be too bad even if the solution is messy.  In 2010, the European banking system was a large creditor, now it is essentially soverigns and supranationals that have most Greek debt exposure.  The European banking system (excluding Greek Banks who are currently backstopped by the ECB) has very little exposure now to Greece.  This is a sovereign problem.


From Der Spiegel:

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